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The crisis of 1929 and the Great Depression, image, image, image, image,…
The crisis of 1929 and the Great Depression
An abrupt end to prosperity
Much of the boom in the US economy was based on massive financial growth
Money was invested in unprecedented speculative operations on the stock market
There was an increase in credit operations without sufficient repayment guarantees
A financial bubble grew and quickly burst
The share price fell sharply and within hours, panic spread across the United States
Investors sold huge amounts of shares at a much lower price than the original
This led to the crash of the New York Stock Exchange
During the crash of the New York Stock Exchange...
Savers saw their money disappear
Most banks went bankrupt as they could not collect money for credit granted
Companies lost their value and their capital
The repercussions of the economic crisis were quickly felt around the world
This generalisation of the crisis is known as the Great Depression
Measures to overcome
the Great Depression
The Great Depression especially affected industrialised countries
Countries and colonies that exported raw materials also suffered the effects
Each country carried out the solutions it considered most appropriate
They were based on economic nationalism and state intervention in the economy
In the USA
President Roosevelt proposed a shock plan
It involved the promotion of public works, subsidies for firms, the control of banking and more social welfare
In Great Britain
The state did not intervene in the economy and restricted itself
Free trade is committed to the free movement of goods without the state intervening
Protectionism consists of establishing customs tariffs on imports to favour the country’s own industry
